Bad debt action to be stepped up at Cherwell

02/09/2022

Around £0.6m is likely to be written off next week

Cherwell District Council looks set to step up its efforts to recover bad debt in the future.  The council’s overall budget includes an allowance for £1.143m of bad debt.  

Around £0.6m of unpaid money is likely to be written off next week, with some of the outstanding cash from more than 10 years ago.   The Council’s executive committee will be told every avenue has been exhausted in pursuing the money, and there is little or no chance of repayment.

The executive will consider plans for the council to increase its efforts to recover bad debt.

Councillor Adam Nell, Portfolio Holder for Finance, said: “As the council has moved into a new era, working solely for its own residents and businesses, we now have the opportunity to focus even more on pursuing money owed to CDC.

“It is never easy to stop pursuing debtors who owe money to the council, especially as the vast majority of residents and business pay what they owe, but there comes a time where all avenues have been exhausted and it is no longer cost-effective to continue.”

“I am pleased that a new and more vigorous corporate debt policy has been produced, intensifying efforts to recover monies owed to the council. Budget holders in all service areas will review outstanding debts on a monthly basis to monitor progress on debt repayment. There will also be even closer co-operation between the council’s finance and legal departments to pursue debt repayment where a legal approach is required because of non-payment.

“As a well-run public organisation, the council has made financial provision for bad debts, something every organisation has to manage. This more than covers the amount being written off, so through sound management we’ve ensured services will not be affected and there will be no impact on residents or businesses.

“We take our responsibility to collect money very seriously, as demonstrated by the excellent collection rates for council tax and business rates that are much better than some other councils, and in future we will be looking at bad debt on a more regular basis.”

Bad debts involve debtors who have been declared bankrupt, have a business which has gone into liquidation, have died, or left a property without trace and all reasonable efforts to trace the debtor have proved unsuccessful. Money owed to the council can include housing benefit overpayments and a range of sundry debts, including non-payment of council tax and business rates.

Currently unpaid council tax stands at 1.9% and business rates at 2.2%.


Published: by Banbury FM Newsteam

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